His latest book, The Undoing Project, explores the extraordinary work of Daniel Kahneman and Amos Tversky whose work created the modern field of behavioral economics, thus “undoing” assumptions about how our mind works. He is digging deeper than baseball and subprime mortgages on this book.
Lewis tells fascinating stories about the “cognitive biases” that Kahneman and Tversky discovered: Overconfidence Bias, Status Quo Bias, Anchoring Effect, Framing, Halo Effect, etc.
Cognitive bias is the tendency to think in ways that can lead to systematic deviations from good judgment. In other words, cognitive biases are inherent thinking errors that humans make.
It turns out; we are emotional, not rational. Lewis’s knack for taking a tough-to-describe concept and breaking it down to an easy to understand actionable strategy is second to none.
How does The Undoing Project relate to ITAD? First, one can observe cognitive biases that Kahneman and Tversky studied at play in ITAD. Secondly, ITAD could be considered an “undoing project” of its own.
For example, Kahneman and Tversky observed confirmation bias. The confirmation bias is the tendency to search for or interpret information in a way that confirms one’s preconceptions. Individuals ignore relevant information and discredit information that does not support their personal views. In other words, they are thinking emotionally instead of rationally.
Kahneman and Tversky also observed status quo bias. Status quo bias is the tendency for people to feel greater regret for bad outcomes that result from new actions taken than for bad consequences that are the result of inaction. In other words, you regret actions more than inactions.
Status quo bias is closely related to loss aversion. Loss aversion is the tendency for people to prefer avoiding losses over acquiring gains. Kahneman and Tversky explained how we feel the pain of loss more than we feel the pleasure of gain.
People become gamblers to avoid a loss. And, financial terms are not the only losses. People take risks to avoid all types of losses (status, reputation, relationships, etc.). Loss aversion helps explains why people avoid reporting facts that could make them look bad. The bet pays off if they are not discovered. If you boil it down, once again it is thinking emotionally rather than rationally.
Kahneman and Tversky’s work explains a lot about ITAD. For example, why lost assets are not reported by employees or by ITAD vendors. Or, why people continue to perform procedures they know to be flawed rather than changing their approach.
Lewis credits Kahneman and Tversky for ‘undoing’ assumptions about human decision making. Their contributions have had positive contributions to many fields. Borrowing from Lewis, I credit ITAD with ‘undoing’ assumptions about ITAM. Unfortunately, this contribution is not positive.
ITAM (IT Asset Management) is the set of business practices that support lifecycle management and decision making for the IT environment. In other words, ITAM is about keeping track of and managing all the IT assets in the company.
ITAM is an under-appreciated yet incredibly important job. Rarely are IT asset managers praised for good work. Often, executives blame IT asset managers when assets go missing.
Most organizations fail to provide ITAM with adequate resources or executive-level support. There is an assumption, however, that ITAM can account for every asset in an organization. Learning 95% inventory accuracy is considered “good” may shatter this assumption.
Inventory accuracy is a complex and changing metric. IT environments are in constant state of flux. A common approach for dealing with a missing asset is to consider the asset “retired” in their system of record. Otherwise, as one consultant carelessly expressed, the IT asset manager “will spend a significant amount of time chasing” missing the assets.
If an asset manager cannot find an asset, they should NOT mark it retired. By marking the asset retired when it is not, ITAM is delaying an investigation or deliberately hiding a potential loss. But hold that thought for a second.
ITAD (IT asset disposition) is the process of disposing of unwanted IT equipment. From an ITAM program perspective, ITAD is the “Final Check-Out.”
95% is not good enough when it comes to ITAD. Tracking must be 100%, or there is a tremendous risk. If a missing asset could potentially contain data, the loss is a security incident, and there is a legal obligation to investigate.
During ITAD, the common approach is for organizations to allocate retired assets to an ITAD vendor. Allocating inventory effectively whitewashes important issues such as missing asset and employee theft.
By retiring missing assets, and then allocating retired assets to ITAD vendors, the process of ITAD become a deceitful “Undoing Project” that systematically deletes potential security incidents. In essence, ITAD can effectively erase all the previous mistakes and omissions.
ITAM has a professional responsibility to share sobering facts with executives. Good or bad. Misstating facts is professional misconduct and potentially illegal.
Why, then, would ITAM use ITAD as an Undoing Project? Kahneman and Tversky could help explain.
ITAM must be part of the solution, not part of the problem. Since we cannot change our cognitive biases (it is human nature), we better change our thinking.
Why not reward IT asset managers for identifying inventory issues instead of punishing them?
Michael Lewis has great answers and findings for baseball and the stock market. Perhaps it is now ITAM’s turn. If we think rationally instead of emotionally, the future of the industry can be what we choose to make of it.
Ready to start the Doing Project for your company today? Call Retire-IT at (888) 839-6555, and we can talk about how we can support you.